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This is an exciting time for services providers. As established by the Technology Services Industry Association (TSIA) in the ground-breaking book B4B, there is major transformation taking place: providers are evolving from simply delivering products and implementing software to delivering business outcomes. This transformation is necessary and, moreover, exciting, as it brings tremendous new opportunities. However, it is also a very challenging time. 

At Mavenlink, we are working with hundreds of successful professional services organizations to tackle this transformation head on, and I can confirm it’s not easy. I am also seeing our own services offerings increase in the areas of consulting services and adoption services. This trend is been putting enormous amounts of pressure on traditional operating models, and as the complexity of delivering services continues to accelerate, so do the complexities surrounding resource management. Organizations must adapt to new services models, or risk getting left behind.

In particular, we see this impacting organizations’ ability to successfully manage their resource pool. In services, your product is your people. Your bottom line relies on getting available resources, with the right skills, matched with the right assignments, at the right margins. It may sound easy, but those who are responsible for resource management will tell you otherwise. It’s the most complicated component of any services business. Data revealed in TSIA’s 2017 State of Professional Services report reinforces this reality — resource management is among the  top 5 business challenges for PS organizations in 2017. Here are a few of the biggest challenges I have personally seen, as well as what high performers are doing to consistently produce desired outcomes.

professional services challenges  

(Click image to enlarge.)
Top professional services business challenges.
Source: The TSIA 2017 State of Professional Services report.

Challenge #1: Shortening Ramp Time to Billable Work

When you run a services organization, it is imperative to get new employees onto billable work as soon as possible. And, as implementations and technology become more complex, so does the onboarding period for new team members. When you are paying team members to sit on the bench, you might as well open a spigot to drain profits. It is critical that you find ways to streamline the onboarding process for new employees, and therefore reduce the ramp time to billable work.

One way I have seen PS organizations accomplish this is to invest in a “new hire boot camp.” At a previous organization we measured the results:

Before Boot Camp

    • Resources took 12+ months to achieve 60% utilization.
    • Resources took 18+ months to achieve 75% utilization.

After Boot Camp

    • Resources took 3 months to achieve 50% utilization.
    • Resources took 4 months to achieve 75% utilization.

The impact to revenue is a factor of how many employees are hired each month. However you can see the benefit is significant if employees are 75% utilized at month 4 vs. 18. We calculated we could accelerate $1M revenue per month based on 10 new hires (net new or replacements/attrition). I suggest investing in and developing a “boot camp” for new hires to help them quickly ramp up and remain committed to it.

Challenge #2: Balancing Supply vs. Demand

In order to optimize your resource management practices, it is critical to understand how to balance supply and demand at your services organization. This requires setting a confidence level early on in planning, preparing yourself for change, involving the right people, and having adequate visibility into the sales pipeline. Balancing supply and demand properly allows you to build a versatile team with numerous skills and abilities to tackle a number of varying projects.

Here are some tips on how to get involved in the sales process early on:

Get Others Involved

The best practice today is to get services sales members involved in the sales process, as early as possible, to understand what projects are in the pipeline and if adequate resources are available to fill the work. Consider involving consulting and project managers to get a full understanding of project demand.

Start Resourcing Before Deal is Won

When balancing supply vs. demand of resources, it is necessary to set standards on when you should start resourcing your projects. This is also referred to as the “Confidence Level” and is the probability that a project is actually going to happen. It’s important to get this timing right so you don’t spin wheels planning for projects that never come to fruition. This process is not only important in ensuring better and more accurate project plans, it builds confidence with your clients. It demonstrates that you have an executable plan to deliver.

Play out the What Ifs

Due to the nature of the services industry, change is inevitable and ad-hoc conflicts will occur. Expect demands to change and project requirements to shift, but ensure that you are not chaotically moving things around when this does happen. In order to be adequately prepared to manage change, ensure you are estimating resource needs early on and at a high level (by role). Hire techno-functional team members and cross train existing team members to increase team versatility.

Challenge #3: Strategically Deploying Resources

As the services industry continues to grow in complexity, so does the process involved in deploying resources. Today, services organizations face the challenge that borders are disappearing and we are in the age of a global workforce. The options are endless. Not to mention, the hyper-specialized demands that come through now require a more efficient way of tracking resource skills, certifications and expertise. Resourcing must be revisited in the age of cross-border collaboration.

Here are some tips on how to strategically deploy resources:

Access Global Talent

Today, it is unwise to only consider hiring local talent. Technological innovations have made it possible, even preferred, to hire workers across the globe. You may fall behind the competition if you fail to look towards your global talent pool when assigning individuals to tasks, projects, or clients. Today, resources are spread across geographies, time zones, and cultures. We are no longer restricted to only working with people that exist within the office walls. It would be a mistake to ignore the vast opportunities available in our global talent market. Global talent is exceptionally valuable because it gives you the ability to assign the best-fit resources to appropriate clients, tasks, or projects. Using a global talent network increases your flexibility to fill billable hours and match the right skills to the right job.

Track Skills

As projects become increasingly complex, it is more important now to understand the skills held by your resources. As more clients demand specialized services, so does the increased need for highly-skilled workers. In order to match clients with service professionals that will satisfy their demand, it is critical to truly understand which resources carry what skill. Services leaders are incorporating skills tracking information into their resource planning process, for good reason. This allows them to staff the best resource for the job while also incentivizing their teams to maintain their profiles, in order for them to land the next great assignment they are seeking.

Create a Shared Resource Pool

Sharing resources has become easier in the age of remote and offsite project delivery. Shared resources are by definition more highly utilized across larger teams. Often times these resources can become very efficient in executing repeatable tasks. They are also typically in lower cost locations, which helps you bolster both utilization and margin. This then allows you to have local, expert service professionals to deploy across high value projects.

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